City of Chicago Minimum Wage Increase

Published On: July 7th, 2022Categories: Payroll, Payroll Tax, Small Business

Effective July 1, 2022, the City of Chicago raised the minimum wage for all employers within the city limits. These new rates depend on the size of the business and whether the position is a tipped employee. The new wages are as follows:

Employers with 21 or more workers:

  • Minimum Wage: $15.40 per hour
  • Tipped Worker: $9.24 per hour

Employers with 4 to 20 workers: 

  • Minimum Wage: $14.50 per hour
  • Tipped Worker: $8.70 per hour

According to the City of Chicago notice, tipped workers are those who receive tips as part of their wage, like restaurant servers. If a tipped worker’s wages plus tips do not equal at least the full minimum wage, the employer must make up the difference.

Additionally, the City of Chicago notice outlines that the minimum wage to be paid under City contracts or concessionaire agreements pursuant to the Order is $16.00 per hour. When applying an allowance for gratuities to the wage of City concessionaire employees in positions that customarily receive gratuities, the resulting rate is $8.20 per hour.

According to the Minimum Wage Ordinance, the City of Chicago will continue to increase the minimum wage annually. Larger employers will increase according to the Consumer Price Index or 2.5%, whichever is lower. For small businesses, the minimum wage will continue to increase to $15 per hour by 2023.

Chicago minimum wage increase.

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About the Author: Andrea Doerdelmann

Andrea Doerdelmann is every payroll client’s preferred Eccezion team member, or she’s at least their employees’ favorite– whether they know it or not. Why? She makes sure everyone gets paid. “Andrea is the lead team member of our payroll department,” firm partner Shelly Casella-Dercole says. “She is great at following through with clients and resolving payroll issues. She is also excellent at adapting to various client accounting systems to get payroll done on the client’s system rather than ours.”